Creating Organizational Value

Is your organization confusing motion for progress? Is your organization creating value for its mission, or just doing busy work in the hopes that your audiences conclude that staff and board are doing a good job? It’s a bit like the danger of having the right answers to the wrong questions vs. having partial answers to the right questions. The former can be very satisfying, but often does not bring the organization closer to its mission and vision.

Here’s a model for generating organizational value.

The Framework

The framework is effective for thinking about how individual staff members can generate value, and for organizations as a whole generate value .  The higher up the vertical access, the greater the compensation and reward systems.

Stage 1 – The Things We Do

At the most basic level we engage resources to “do things” – perform tasks.  We want our resources to perform tasks in an efficient and consistent manner.  We typically do not expect these resources to bring outside knowledge to the tasks and we don’t expect them to exercise a lot of judgment while performing their tasks.

However, if your organization is only about repetitive actions, then it’s de facto a transactional entity, which delivers relatively low value at relatively low levels.

Stage 2  – The Things We Know

At the next level our organizations add value by acquiring relevant knowledge about the operations we perform and the goals we’re seeking to achieve.  Acquiring new and relevant knowledge about the tasks we perform is necessary under dynamic conditions both inside, as well as outside the organization.  But knowledge on its own is not sufficient to create value.

Stage 3 – How We Think

The third level looks at how we think about the impacts and use of the acquired knowledge. It is important to stress that the possession of relevant knowledge is only a prerequisite for higher value; how we think about and synthesize that knowledge is a separate skill to be developed and rewarded.

In the broader scheme of value generation these three areas of performance are typically still “within the organization” and may be motion masquerading as success in the greater context of creating organizational value and remaining relevant.

Stage 4 – Enabling Progress

The pinnacle of our organizations’ work is creating an impact outside our organizations.  If it’s a society, it’s advancing the profession the organization represents.  If it’s a trade association it’s advancing a business or industry sector, usually by improving competitiveness for all involved.

Why Does Any of This Matter?

Since the COVID-19 pandemic has thoroughly upset staff work by requiring remote work, this is an ideal time to evaluate how service work is not only performed, but what the work itself should be.  This is especially true for organizations that are more mission driven to create an impact in their professions or industry sectors beyond the boundaries of the organization itself.

To be clear, this is not a new situation.  Scientific Management Theory that treated labor as another factor of input to be measured like a mechanical system was falling out of favor a century ago.  Organizational leaders who find it challenging to supervise association staff who are out of sight due to the pandemic should seize the opportunity to reconceive that work.  Especially if the real value of work is to produce external outcomes vs. merely remaining busy.  That’s no better than generating light but no heat.

The above is one framework for reimaging how your organizational staff creates value.  This journey begins with defining the outcomes to be produced.  Then let staff participate in the creation of the work to produce those outcomes.  Management will likely be pleasantly surprised at how creative and imaginative staff can be in defining the work that leads to those outcomes.

Posted in Management.

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